My parents have a college fund set aside for me. I go to community college, so it's not that expensive. I have about $4,200 left.
The thing is, about two months ago I was in a car accident and totalled my car. I have been driving one of my dad's beaters ever since, although I NEED to get another vehicle soon. I only have about $1000 in savings, which I do not want to spend because my boyfriend and I are trying to move out.
I'm thinking of asking my parents if I can use (most of) my college fund to buy a used car (from a dealer, with a warranty).
I really do not want a loan, but I will still have full coverage insurance because I do not want to be in another situation that I am in now (I only had liability on my other car).
In exchange, I am going to pay for my own college. It would actually save me a lot of money because without the $4,200, I would qualify for a lot of financial aid. Right now I don't qualify for any.
SO cash for new *used* car from them IN EXCHANGE FOR full coverage insurance and paying for my own education from me.
Does this sound like something parents would go for?
Any suggestions to improve so they will accept my offer?
I have a full-time job, also.
My dad wants his car back, this is why I NEED another one.
Also, the money is in mine and my mom's name. I could just take it, but I would have a terribly guilty conscience.
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April 26th, 2009 at 8:11 am
Your insurance will go up with you having an accident. I know buying a car seems like a necessary thing right now, but it isn't the best thing to do. Promises cannot always be fulfilled when it comes right down to the crunch. Thank your parents for lending you a 'beater' while you need it, which means you don't NEED a new car, you really WANT a new car.
My advice, because you did ask, is that you persevere and in eight months or a year, see if you can bank the amount that you would have put towards insurance into the purchase of a vehicle. I think your parents would go for that. Sometimes when you think out a solution on a longer term basis, parents give a little more than they are asked. Instead of 'rushing' into a situation where an immediate gratification is the result.
April 26th, 2009 at 8:11 am
No deal! The $4,200, since it is your parent's name, has little effect of qualifying for financial aid. As long as you dad is supplying a car (even if it is a beater) it is more cost effective than buying your own. If you need to supply $1,000 to move in with your boyfriend, you really should be looking for a better boyfriend.
April 26th, 2009 at 8:11 am
Hi i do not think whither its a good deal for your parents but i only advise to approach them in a friendly way whither to make it a deal or no deal with them.le me wish you the best of all.
April 26th, 2009 at 8:11 am
If I were your parents, I would not go for this. Your parents main job in life is to protect you and see that you get ahead in life. If I woke up in your shoes, I would do the following.
I would forget about moving out with the boyfriend. Take the $1k and buy a used beater. Maybe work some and put extra towards the car. Live at home until college is finished and keep the $4200 in your parents name to pay for school. Delaying gratification is one of the main signs of adulthood. From the sounds of it you are not ready to move out yet anyway. If you have any other debt, you need to pay that off as well. Before moving out, you need to have an emergency fund of 3-6 months of expenses saved as well. If something goes wrong and you lose your job or ability to pay your bills, How would you pay you bills? Please do not say credit cards. That is the worst possible idea. You need cash.
I know this is not the answer you were looking for, however it is the best scenario for someone in your situation. Stay put until college is done with. Buy a beater car to drive for now. If your dad doesn't mind, drive his beater for free or offer to buy it from him for $1000 (or whatever it is worth). 10 years from now you will look back and be very happy you did.
April 26th, 2009 at 8:11 am
You sound like a very smart girl! Thinking about what you want to do before doing it is the best thing you have done so far! Sometimes parents think that you are irresponsible and do not trust you at times. Come up with a couple of strategic solutions but always make sure that your parents know and agree with what you are doing. One day you will be on your own and need there help, we all have. Finish school and brainstorm with your parents on what is best. Come to an agreement even if it takes time. Talk things out and anything is possible!
April 26th, 2009 at 8:11 am
I won't attempt to give you advice on how to handle your college fund, that is strictly between you and your parents. I only want to warn you of the pitfalls by getting your financing through a used car dealer. It will be a decision you will live to regret. You can get financing from a used car lot, expecially those specializing in "bad credit loans" They really mean it doesn't matter to them what kind of bad credit you have. That's because they will charge you an exorbinant interest rate, equal to that of a much newer car at a reasonable ib terest rate, if you could qualify for it. First you are upside down when you drive off the lot, meaning you owe more than the car is worth because of the interest rate you are paying. From then on you are stuck with the car and the high loan amount . You cannot sell the car until the loan is paid off because you can't get the title to the car until that time and you can't sell without a title. Besides no one will buy a car for more than the Blue Book, which is the standard in the industry to decide what the car is worth You can google Ble Book and find out for yourself. If you can get refiancing, the lender will only loan the blue book value, leaving you still owing the car lot finane company the remainder. Even if you have full insurance coverage and have an accident or total the car, the insurance will only pay the Blue Book value and you're stuck paying on a car you cannot drive. You cannot transfer the debt to someone else without the lender's approval and once again no one will want to take on a loan amount that exceeds the value of the car . If you just give someone the car and trust they make the payments you are still responsible for anything that happens with or to the car. If the person you gave the car to has a wreck and injures someone it's your resonsibility, it's your car. If worse comes to worse and you just can't keep up the high payments and the car is repossessed, it will be sold at auction and the lender will come after you for the difference on what is owed and what the car sold for. THis could lead all the way to a law suit, and if applicable in your state, garnishment of wages. I hope these are enough reasons to steer you away from used car lot financing and use a bank. If you don't qualify at the bank, so be it, wait until you fix whatever is wrong that kept you from qualifying and get a car then.
April 26th, 2009 at 8:11 am
Your whole plan hangs on whether you will be able to secure financial aid. Have you looked into that yet?
I've had a son and two daughters who figured that getting aid would be a snap….but coming from a middle class family we apparently make way too much money to qualify for Pell or any other grants. They don't take YOUR income into account, but your parents income and ability to help pay for your education.
So…..by taking your college money and spending it on a car, you could be messing up your chances to go to college. Either lock down your grant, or sit down and put your priorities in order. Moving out will only add to your living expenses, so you better reconsider that.